The legislature asked health care providers to work together in local communities and form “Coordinated Care Organizations.”

CCOs bring together hospitals, counties and most health plans in a given area. The state then gives the CCO a lump sum to look after patients. The idea is that the CCO will assign a care team to patients with complex problems, so their physical, dental and mental health issues can be worked on together.

Tina Edlund of Oregon Health Authority says the team will make sure patient gets the right care and money isn’t wasted on conflicting medications or repeated trips to the ER.

Edlund explains, “The goal is that over time, more and more of your payment is based on the outcomes you get. … By using that kind of approach, you’re building in an incentive to provide the kind of care that’s going to get you the best outcomes.”

The state has two years to show the federal government CCOs are going to work. If they fail, the state faces hundreds of millions of dollars in reduced payments.